The London SW1-based electrical and electronic component distributor Electrocomponents Plc has trimmed off its Franchised Components Division selling it for a total of approximately UKP15m to Arrow Electronics Inc. The sum includes a repayment of indebtedness of around UKP8.1m in the UK, representing a premium UKP1.4m over the estimated net asset value at July 31. The division is composed of RR Electronics Ltd (which is going to Arrow Electronics (UK) Ltd), and the West German Retron Group (which is going to Arrow’s associated company in West Germany, Spoerle Electronic Handelgesellschaft mbH & Co). The deal is planned to take place on July 31. Over the past financial year, ending March 31, the Franchised Components Division made a profit of UKP700,000 on a turnover of UKP37.6m. Electrocomponents, with a total turnover last year in the UKP400m margin, reckons it had two options on this very small part of its business: either it had to put resources into the division to push it into a market leadership position, or it had to get out altogether, and it has chosen the latter option.
